1. Create a Budget You Can Both Live With
35% Housing
20% Transportation
15% Debt
20% Other Expenses
10% Savings
2. Learn the Debt Dos and Dont’s
*DO break your bad debt habits. The average American consumer carries four credit cards and 6,500 in credit card debt. Starting a new marriage with a huge debt load can be burdensome.
*DON”T live beyond your means. According to the Federal Reserve Bank, 40% of households simply spend more than they earn.
*DO communicate honestly about your spending habits. 9 out of 10 married people say they avoid talking to their partner about money, yet couples who take the time to discuss finances regularly do better financially.
*DON”T abuse your credit. Although it might be tempting to buy furnishings or electronics for your new home, impulse purchases can really add up and harm your credit down the road.
3. Save For a Rainy Day…And More
Starting a family or retiring from your job might seem like a long way off, but it pays to start planning early. Saving and investing is an essential part of your financial game plan–and it means more than just putting a few dollars in a savings account. Your savings game plan should include:
Emergencies: A shocking 64% of Americans say they do not have enough cash saved to cover a $1,000 emergency expense and 42% of Americans say they live paycheck-to-paycheck. The rule of thumb is that you should have at least three to six months of living expenses in the bank.
Short Term Goals: Maybe you’re dreaming of a summer vacation, new appliances for your home or another big-ticket purchase. Save up for travel–its better to pay cash than get locked into high interest credit card debt.
Child’s Education: If you plan to start a family, it’s a good idea to think about education as well. The average price tag for four years of tuition and fees at four-year institutions has climbed to 32,976 for public schools and 114,000 for private schools. Starting early makes a big difference.
Retirement: A full 29% of workers say they have less than $1,000 saved for retirement. In total, 56% say they have saved less than $25,000. Start saving and investing today. In fact the average Social Security benefit check pays just $1,229 per month. Could you and your spouse live on that?
4. Plan For Tomorrow…Today
When you’re married, you may depend on your spouse’s income to help pay the mortgage and other living expenses. No one wants to think about tragedy or loss, but you should discuss with your spouse a game plan if something unexpected should happen.
While nothing can replace a spouse, a term life insurance policy protects your family if something should happen. For most people, term life still offers the best combination of coverage and cost.
In addition to considering a life insurance policy, its important to talk about each other’s wishes if one of you should die. A will gives legally binding instructions for the distribution of your property and the care of your children if you pass away.
5. Get Your Financial Snapshot
Planning for the unexpected, saving for retirement, paying off debt…as you start your new life together, does all of this seem daunting? It doesn’t have to be.
Before you smile for the wedding photographer’s cameras, get a “financial snapshot” taken . Call us today for a free Financial Needs Analysis (FNA). The FNA gives a detailed overview of your current financial situation and offers suggestions on how to prepare for a secure financial future. The FNA is complimentary, confidential and customized for you and your spouse.
Todd Baumbach – Regional Vice President – Primerica Financial Services
2445 S 130th Circle St 100, Omaha, NE 68144
(402) 915-2596 www.primerica.com/tbaumbach
